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Augmented and Unconstrained: revisiting the Regional Knowledge Production Function

Author

Listed:
  • Sylvie Charlot

    (GAEL UMR 1215, INRA; University of Grenoble, France.)

  • Riccardo Crescenzi

    (London School of Economics, Spatial Economics Research Centre, UK.)

  • Antonio Musolesi

    (Dept. of Economics and Management. University of Ferrara, Italy.)

Abstract

By adopting a semiparametric approach, the 'traditional' regional knowledge production function is developed in three complementary directions. First, the model is augmented with region-speci c time trends in order to account for endogeneity due to selection on unobservables. Second, the nonparametric part of the model relaxes the standard assumptions of linearity and additivity regarding the effect of R&D and human capital. Finally, the assumption of homogeneity in the effects of R&D and human capital is also relaxed by explicitly accounting for the differences between developed and lagging regions. The analysis of the genesis of innovation in the regions of the European Union unveils nonlinearities and threshold effects, complex interactions, and shadows effects that cannot be uncovered by standard parametric formulations.

Suggested Citation

  • Sylvie Charlot & Riccardo Crescenzi & Antonio Musolesi, 2014. "Augmented and Unconstrained: revisiting the Regional Knowledge Production Function," SEEDS Working Papers 2414, SEEDS, Sustainability Environmental Economics and Dynamics Studies, revised Aug 2014.
    • Handle: RePEc:srt:wpaper:2414
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    More about this item

    Keywords

    Innovation; Europe; R&D; Regional knowledge production function; Semiparametric models;
    All these keywords.

    JEL classification:

    • O32 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Management of Technological Innovation and R&D
    • R11 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Regional Economic Activity: Growth, Development, Environmental Issues, and Changes
    • C14 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods and Methodology: General - - - Semiparametric and Nonparametric Methods: General
    • C23 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Models with Panel Data; Spatio-temporal Models

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